Vietnam's importing channels and their characteristics

German exporters can access Vietnam’s market through the following channels:

  • Vietnamese importing partners: Importing partners can be companies that buy products for their own consumption (like raw materials), or agents that import goods and then redistribute them to shops, supermarkets, companies… (like machinery, equipment or consumer products). This is the main importing channel of Vietnam’s market.

In order to export in this form, German suppliers must learn about the distribution system in Vietnam for their goods and look for potential importers as well as their characteristics and demands. Vietnamese importers are often highly concerned about price. Thus, they often research and compare prices of different import sources before making a purchase decision. However, Vietnamese buyers have increasing demand for high quality products (for production of exports to meet high requirements of import markets, or for personal consumption), thus the product quality is also an increasingly important factor in the purchase decision. When considering the quality of goods, the origin country is an important criteria. Products manufactured or branded from a developed country will be more appreciated.

  • Commercial presence in Vietnam: This is an importing channel that a German company establishes a commercial presence in Vietnam to perform the function of importing goods directly from Germany and distributing to agents, shops, or consumers in Vietnam. This form is mainly applied by companies that want to export in large quantities and operate long-term in Vietnam because it will take a long time and high cost to establish a commercial presence. German companies can establish joint ventures or 100% foreign-invested enterprises to import and distribute goods (wholesale and retail) in Vietnam. However, Vietnam has not yet allowed German distributors to distribute the following 7 types of products: Lubricating oils and greases (except for cases where FDI enterprises manufacture and distribute their own products); Rice; Sugar; Recorded items; Books, newspapers and magazines.

  • Cross-border e-commerce: German suppliers can sell directly (cross-border) to Vietnamese consumers through e-commerce platforms. This form has become more and more popular in Vietnam with the appearance of e-commerce channels such as Lazada, Tiki, Shopee…. which allow consumers to buy goods directly from foreign suppliers. However, under the EVFTA commitments, Vietnam only allows German suppliers to sell goods across the border to Vietnamese consumers for personal consumption, not for resale or for business purposes (other than computer software programs – possibly for both personal and commercial use), and Vietnam has no commitments on distribution of the following goods: Cigarettes and cigars; Publications (books, newspapers and magazines); Video records on whatever medium; Precious metals and stones; Pharmaceutical products and drugs (excluding non-pharmaceutical nutritional supplements in tablet, capsule or powdered form); Explosives; Crude oil and processed oil; Cane and beet sugar; Rice.

Although this form is simple and cost-effective for German suppliers, the sales volume is not large and it only applies to consumer products

Source: "Business Handbook: Exploiting the EVFTA  to import and export goods between Vietnam and Germany" - Center for WTO and International Trade